France: Le Pen Promises To Reintroduce Franc, 1:1 With Euro – OpEd

Providing some much needed details on her plans to redenominate the French currency, should she win the French presidential election in under two months, on Wednesday Marine le Pen told RTL radio should would introduce a new franc at a rate of one-to-one to the euro and then allow it to fluctuate, despite previously saying that any new national currency would continue to be pegged to a basket of currencies.

She said the new French franc would likely fall “against whatever currency Germany uses”, making French car exports more competitive, but said it might rise against the currency in Italy, a country she said would also be better off without the euro.

Incidentally, many agree with Le Pen, and according to Paddy Power, Italy now has even odds of leaving the EU before 2025, far higher than even perpetually depressed Greece.

But back to Le Pen, who as Bloomberg writes has expressed often contradictory views on the issue throughout the campaign. At first she wouldn’t even say she proposed leaving the common currency, instead talking about restoring “monetary sovereignty.” She’s recently talked more openly about leaving the euro, but without many details on how it would be done. In her RTL interview, Le Pen wasn’t clear if she envisioned a completely free or controlled float.

Some have been quick to mock Le Pen’s vacillation on the issue: “Monday she’s out of the euro, Tuesday she’s not, Wednesday she pegs, Thursday she fluctuates,” said Patrick Artus, chief economist at Natixis Securities. “It’s nonsense and it will never be implemented. We have to stop taking her economic pretensions seriously.”

Which, of course, is precisely what they said about Trump.

Le Pen left room for interpretation on the euro when she unveiled her 144-point program a month ago, saying she’d “return to monetary sovereignty” without mentioning the euro. An adviser explained at the time that the new franc would be pegged to a basket of currencies comparable to the European Currency Unit, which preceded the euro. However, last week, in a speech about economic policy, she was more explicit about leaving the euro, and at a conference with a French business lobby in Paris Tuesday she said the single currency “was unsustainable because the discrepancies” between member states are too wide, as Bloomberg reported.

She denied that leaving the euro and imposing what she calls “intelligent protectionism” would cut off trade, saying France traded better before joining the European Union. “If I want a new national money, it’s to help us set off to conquer the world,” she said. She didn’t mention France’s debt Wednesday, but in the past has said it will be denominated in the new currency. As reported previously, some have indeed taken Le Pen’s warning seriously as France has some $1.7 trillion in debt issued under French law, which would permit her government to change the denomination currency if she so choose, effectively wiping out most of French debt.

Yet while Le Pen has flip-floped on the topic of how the franc would treated under her regime, she has been consistent in her pledge to revoke the central bank’s independence to allow her to print more of the new currency to fund her policies (spoiler alert: that does not lead to a happy ending).

Meanwhile, according to recent polls Le Pen would win the most votes in the April 23 first round of the presidential election but heavily lose the May 7 second round against independent Emmanuel Macron. Tuesday’s daily Ifop poll put her at 26 percent and Macron at 25 percent in the first round, with Macron winning the run-off 61.5-38.5 percent.

On RTL, she attacked former Rothschild banker Macron as “a pure product of the banking system, of savage globalization.”

In the two-hour interview Wednesday, she also said she’d keep the Fessenheim nuclear power plant open and maintain tax advantages for diesel cars, saying pollution in France was more due to wind carrying emissions from German coal power plants. Asked about International Women’s Day, she said the main challenge facing women in France today is the rise of Islam. Le Pen also said that should the legal crackdown against her accelerate, she would simply not respect a judicial summons before the election, and she would refuse to be questioned by investigative judges until after the presidential election, adding that “the justice system is being manipulated to influence the presidential election”.